28 February 2002
Inquiries: National Accounts: Mr Tuomas Rothovius
+358 9 1734 3360, Mr Olli Savela +358 9 1734 3316
General Government Deficit and Debt: Ms Paula Koistinen-Jokiniemi
+358 9 1734 3362, skt.95@stat.fi
Director in charge: Mr Markku Suur-Kujala
Gross domestic product grew by 0.7 per cent last year
According to Statistics Finland's preliminary data, the volume of GDP grew by 0.7 per cent in 2001. The growth was very modest in comparison to the fast growth rate in the last seven years. Gross domestic product, or the combined value added of the goods and services produced, totalled EUR 135 billion, i.e. FIM 803 billion last year.
In the last quarter of the year, GDP decreased by 0.5 per cent compared to the previous quarter. The growth slowed down already in the January to March period, when output remained unchanged from the end of the previous year. In the second quarter of the year, GDP contracted by 1.8 per cent from the previous quarter. In the third quarter output increased by 1.4 per cent, however.
Volume changes of GDP in 1993-2001, %
The growth of the national economy hinged on domestic demand last year. In contrast to previous years, net exports did not increase the growth of the national economy, as the volume of both exports and imports decreased by about one per cent.
Final consumption expenditure increased by 1.5 per cent last year. Households' consumption was slowed by car sales, which declined by one quarter. In contrast, consumption of other than durable consumer goods grew by over 4 per cent and that of services by 2 per cent. In the public sector, central government consumption expenditure decreased by about half a per cent, but the volume of local government consumption expenditure went up by 2.6 per cent.
Investments increased by 2 per cent. The volume of investments in machinery and equipment grew by close on 5 per cent. Investments in residential buildings contracted by 7 per cent compared to the year before, whereas construction of other buildings still increased by 4 per cent.
Output grew primarily in the service industries, with a growth of almost 2 per cent. Output in manufacturing decreased by one per cent and in construction by 1.5 per cent. In agriculture output increased but in forestry it declined clearly.
Enterprises' operating surplus decreased from the previous year
Enterprises' profits decreased slightly from the record level of the previous year. Enterprises' operating surplus was EUR 21 billion, down by 5 per cent. Operating surplus is roughly equivalent to trading profit in business bookkeeping. Direct taxes paid by enterprises amounted to good EUR 5 billion, which is 18 per cent less than the year before. Dividends paid by enterprises rose by 11 per cent from the previous year to good EUR 8 billion. Enterprises' fixed investments grew by 9 per cent last year. Enterprises' net lending, which describes their financial position, showed a surplus of EUR 3.6 billion. In the previous year the surplus was EUR 5.1 billion.
The financial position of financial and insurance institutions improved slightly
The net interest income of financial institutions grew by 7 per cent from the previous year, due to a substantial increase in the credit stock. In contrast, banks' premium income and other income decreased by 6 per cent. Insurance institutions' returns on investments decreased from the previous year's record level. Liability insurance premium income grew, while life insurance premium income decreased.
Households' real income grew by 2.9 per cent
The disposable income of households increased by 5.7 per cent in nominal terms and by 2.9 per cent in real terms last year. The increase in the households' gross income was mostly attributable to the over 6 per cent wage sum growth, which was a result of a rise in the earnings level, and in part also of the improved employment situation. Households' entrepreneurial income remained at the previous year's level. Social security benefits received by households increased by 4 per cent, of which the pension sum increased by nearly 7 per cent, while unemployment benefits fell as unemployment decreased. Financial support to students increased, whereas the general housing allowance decreased. Dividend income received by households increased by one fifth.
In nominal terms, the final consumption expenditure of households grew by 4.2 per cent, i.e. less than their disposable income. The savings rate rose to 3.3 per cent from the previous year's 1.6 per cent.
General government surplus 4.9 per cent of GDP
The financial position of central government showed a surplus for the second consecutive year. The surplus was EUR 2.5 billion, as compared to EUR 4.5 billion in the previous year. The decrease of the surplus was a result of the fall in tax revenues.
The financial position of local government showed a deficit of EUR 400 million, as compared to a surplus of EUR 300 million in the previous year. The financial surplus of social security funds amounted to EUR 4.5 billion, which is unchanged from 2000.
Central government revenues from indirect taxes grew by 1.4 per cent. Revenues from the corporate tax decreased by 25 per cent from the record level of the previous year. The decrease in corporate taxes is explained by the decline in corporate profits. Revenues from the income tax paid by households increased by 2 per cent. The taxes paid by both corporations and households are influenced by the adjustments made to the timing of recording tax revenues in national accounts.
The total net lending of general government, or the so-called EMU surplus, amounted to 4.9 per cent of GDP, whereas the surplus was 7 per cent in the previous year. The consolidated gross debt of general government, or EMU debt, was 43.6 per cent of GDP at the end of the year. At the end of 2000, EMU debt amounted to 44 per cent.
The tax rate, or the proportion of taxes and statutory social security contributions of GDP, was 46.2 per cent last year. It fell slightly from the year before when the tax rate was 46.8 per cent.
Public expenditure accounted for 49.4 per cent of GDP. The proportion rose slightly from the previous year when it was 48.6 per cent. The growth of this proportion is explained by the slow growth of GDP.
Source: National Accounts Preliminary Data, 2001.
Statistics Finland
General Government Deficit and Gross Debt According to EMU
Criteria. Statistics Finland